Challenge to ACA employer mandate fails

Posted Mon, December 2nd, 2013 9:42 am by Lyle Denniston

For the second time in two years, the Supreme Court has refused to hear constitutional challenges to the new federal health care law’s mandate that employers provide affordable health insurance for their workers. Without comment, the Court on Monday turned aside a broad complaint about that Affordable Care Act mandate by Liberty University, a religiously affiliated college in Lynchburg, VA. Liberty also had sought review of new challenges to the individual insurance mandate, but those, too, failed with the denial of review.

The Court granted no new cases, having accepted three last week. It asked the federal government for its views on a case testing whether federal law bars customers who bought natural gas in the retail market from filing state antitrust lawsuits challenging price-setting in the wholesale market (ONEOK Inc., v. Learjet, 13-271). Justice Samuel A. Alito, Jr., took no part in that action. The Justices also denied review of two significant new cases testing the power of state governments to impose taxes on sales to customers in those states by Internet retailers like Amazon and Overstock.

In a summary ruling, issued in an unsigned three-page opinion, the Court told the Sixth Circuit Court to sort out a dispute over which federal law governs attempts by taxpayers to get a refund when they overpaid their taxes, and seek interest on the overpaid amounts. The decision came in the case of Ford Motor Co. v. U.S. (13-113), a case involving Ford’s claim that the government owes it added interest of at least $445 million. The government had told the Court that the case belonged only in the Court of Federal Claims, not the regular federal courts. That is the key issue the Sixth Circuit is now to decide. The case is not about the right to sue for a tax refund; it focuses only on where to sue to seek additional interest when too much tax has been paid.

The Liberty University case that the Court chose to bypass (Liberty v. Lew,13-306) involved several challenges to the ACA that the Supreme Court either had refused to review, or had not been appealed to the Court, when the Justices two years ago ruled on the first constitutional challenges to the law. While agreeing then to review the individual mandate, it refused to review the employer mandate.

The Court in the end upheld the individual mandate under the government’s taxing power, after ruling that the provision was beyond Congress’s power under the Commerce Clause. Liberty University, besides seeking to contest the employer mandate under the Commerce Clause, also sought review of its constitutionality under the taxing clause. The University’s petition also contended that the individual mandate violated the religious freedom of the school and of its employees, under the Constitution’s First Amendment and the Religious Freedom Restoration Act.

In a belated move in its case, Liberty also attempted to challenge the ACA’s contraception mandate on employers, but the Fourth Circuit Court had found that issue was raised too late and it did not decide it. Last week, the Court agreed to rule on the constitutionality of the contraceptive mandate in two new cases.

Liberty University was one of the first to go to court to protest the new health care law. It sought Supreme Court review earlier, but the Justices also declined to hear that case, although they did agree to allow Liberty to return to the Fourth Circuit to press its claims. That further review by the Circuit Court, rejecting all of Liberty’s challenges, is what the Justices refused to disturb on Monday.

Although the ACA’s employer mandate — which applies to all employers with 50 or more workers and that provide health coverage — has now survived two attempts to challenge it in the Supreme Court, there remain other challenges to it that are working their way through lower courts. The employer mandate was scheduled to take effect this year, but has been postponed until 2014 to give employers more time to adjust to it.

The Court’s refusal on Monday to hear two new cases challenging state taxes on Internet-only sales followed a pattern in recent years, in which the Court has refused repeatedly to reconsider or to further clarify its famous 1992 decision in Quill Corp., v. North Dakota, limiting state power to tax sales to in-state customers, allowing such levies only when the company involved had an actual presence in the state — such as an office, sales force, or property.

Turned aside Monday were Overstock.com Inc., v. New York Taxation Department(13-252) and Amazon.com v. New York Taxation Department (13-259). Both Internet retailers contended that they had no presence in the state, and thus should be exempt from taxes on purchases from them by New York customers. New York’s highest state court, the Court of Appeals, ruled, however, that they were subject to tax in New York because they had contracts with local affiliates that generated customers for them through Internet links to the Overstock and Amazon websites.

The Court issued a one-sentence order that dismissed, for lack of jurisdiction, the case of Alabama Legislative Black Caucus v. Alabama (13-395). The case questioned whether challengers to a state legislative redistricting plan have a right to sue when the plan breaks up many counties between districts, with the result that there is a wide difference in the representation of county residents because county delegations in the legislature have control over state laws affecting those residents.

The Court took no action on Monday on a new case testing the power of states to flatly ban contributions by corporations to political candidates. The case of Iowa Right to Life Committee v. Tooker (13-407), may be considered later, but also may be put on hold until after the Court clarifies First Amendment doctrine on campaign donations in a pending federal case.

Merits Case Pages and Archives

The court issued additional orders from the December 2 conference on Monday. The court did not grant any new cases or call for the views of the solicitor general in any cases. On Tuesday, the court released its opinions in three cases. The court also heard oral arguments on Monday, Tuesday and Wednesday. The calendar for the December sitting is available on the court's website. On Friday the justices met for their December 9 conference; Honeycutt v. United States.

Major Cases

Gloucester County School Board v. G.G.(1) Whether courts should extend deference to an unpublished agency letter that, among other things, does not carry the force of law and was adopted in the context of the very dispute in which deference is sought; and (2) whether, with or without deference to the agency, the Department of Education's specific interpretation of Title IX and 34 C.F.R. § 106.33, which provides that a funding recipient providing sex-separated facilities must “generally treat transgender students consistent with their gender identity,” should be given effect.

Bank of America Corp. v. City of Miami(1) Whether, by limiting suit to “aggrieved person[s],” Congress required that a Fair Housing Act plaintiff plead more than just Article III injury-in-fact; and (2) whether proximate cause requires more than just the possibility that a defendant could have foreseen that the remote plaintiff might ultimately lose money through some theoretical chain of contingencies.

Moore v. Texas(1) Whether it violates the Eighth Amendment and this Court’s decisions in Hall v. Florida and Atkins v. Virginia to prohibit the use of current medical standards on intellectual disability, and require the use of outdated medical standards, in determining whether an individual may be executed.

Pena-Rodriguez v. ColoradoWhether a no-impeachment rule constitutionally may bar evidence of racial bias offered to prove a violation of the Sixth Amendment right to an impartial jury.

Conference of December 9, 2016

FTS USA, LLC v. Monroe (1) Whether the Fair Labor Standards Act and the Due Process Clause permit a collective action to be certified and tried to verdict based on testimony from a small subset of the putative plaintiffs, without either any statistical or other similarly reliable showing that the experiences of those who testified are typical and can reliably be extrapolated to the entire class, or a jury finding that the testifying witnesses are representative of the absent plaintiffs; and (2) whether the procedure for determining damages upheld by the Sixth Circuit, in which the district court unilaterally determined damages without any jury finding, violates the Seventh Amendment.

Overton v. United States Whether, consistent with this Court's Brady v. Maryland jurisprudence, a court may require a defendant to demonstrate that suppressed evidence “would have led the jury to doubt virtually everything” about the government's case in order to establish that the evidence is material.

Turner v. United States (1) Whether, under Brady v. Maryland, courts may consider information that arises after trial in determining the materiality of suppressed evidence; and (2) whether, in a case where no physical evidence inculpated petitioners, the prosecution's suppression of information that included the identification of a plausible alternative perpetrator violated petitioners' due process rights under Brady.